Tesla Inc. (TSLA US) is the largest non-ETF short in the U.S. market at $9.03 billion, $2.4 billion larger than second place AT&T’s (T US) short interest, $3.1 billion larger than third place Alphabet’s (GOOG US & GOOGL US) short interest and $3.3 billion larger than fourth place Apple’s (AAPL US) short interest. Only China’s Alibaba Group ADR (BABA US) has a larger short interest at $22.1 billion. Tesla is one of only four non-tech stocks in the top ten most shorted stocks in the U.S. market.
Tesla short sellers have been building their short exposure regardless of the losses they have incurred. Shorts were down $3.64 billion in mark to market losses in 2016 and the first half of 2017 while their short exposure increased 49% to over $9.9 billion.
July and August 2017 were profitable for Tesla shorts and they were able to recoup over $1.1 billion of their mark to market losses even as short interest decreased from its $10.96 billion historical high in mid-June.
After the market close today, Tesla reported quarterly results with a narrower than expected quarterly loss and strong order demand for the upcoming Model 3 and existing Model S and Model X. With aftermarket trading pricing Tesla shares at $336, short sellers are down $286 million in mark to market losses already.
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Managing Director Predictive Analytics, S3 Partners
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